Japan's economy joins Germany and France and emerges out of its recession on rebounding exports and consumer spending.
- The second biggest economy expanded its GDP at an annual 3.7% in the second quarter, marking the first growth in five quarters.Â Positive GDP is good but Japan missed analysts' estimates of 3.9% spurring concerns that growth will falter once the governments worldwide complete $2 trillion in stimulus spending.
- Unemployment in Japan is reaching a record high as companies continue to drop jobs to cut costs.Â Starting off this week in the Asian session, risk aversion takes first seat as Asian stocks extended a global decline.Â The yen is being bought and higher yielding currencies are being sold off.Â The yen rose to a two-week high against the euro and the most against the Australian and New Zealand dollars.
- US regulators closed down five lenders, bringing the total number of failed banks to 77 this year.Â The US dollar gained for a second day against the sterling on a report that showed British home sellers lowered the average asking prices by 2.2%, the most in eight months.
- The euro may hold off losses today on speculation that a German report tomorrow will show investor confidence rose.Â Expectations for the German ZEW Economic Sentiment are to rise to 45 from the previous month's reading at 39.5.
- Crude oil collapsed well below $70 a barrel losing 4% on Friday after a surprise decline in US consumer confidence, rising stockpiles and reduced demand.Â WTI continued its decline this week and as of 06:30 GMT Oil is trading below $66.50 a barrel.
Currency to watch out for: EURUSD & USDJPY
- The EURUSD pivot point is at 1.4210 with a preference to enter into short positions at 1.4200
- The USDJPY pivot point is at 95.00 with a preference to enter into short positions at 94.95
Today's calendar and market movers:
- Switzerland retail sales year on year expected to rise to 0.8%
- New York Fed Manufacturing Index expected to rise to 2.5
- US NAHB Housing Market Index expected to rise to 18
- US stocks fell broadly on Friday breaking a four-week winning steak after a weaker US consumer sentiment raises fears that consumer spending will hinder an early economic recovery.
- As of 06:30 GMT the Nikkei is trading at -3.1% and the Hang Seng at -2.6%.